The Expected Return on the Market Is 12 Percent with a Standard

question 43

Multiple Choice

The expected return on the market is 12 percent with a standard deviation of 15 percent and the risk-free rate is 5 percent.What is the required return on an efficient portfolio that has a standard deviation of 18 percent?

• A) 10.83%
• B) 12.67%
• C) 13.40%
• D) 14.40%

---

Definitions:

Ectoderm

The outermost layer of cells or tissue of an embryo in early development, giving rise to the outer layer of skin and nervous system.

Endoderm

The innermost layer of cells or tissue of an embryo in early development, which gives rise to the linings of the digestive and respiratory systems.

Trichomoniasis

A sexually transmitted infection caused by the parasite Trichomonas vaginalis, resulting in itching, burning, and often a greenish discharge.

Blood-sucking Insects

Insects that feed on the blood of humans or animals, often acting as vectors for various diseases.